The relationship between ESG and firm value. Case study of the automotive industry

Dincă, Marius Sorin; Vezeteu, Cosmin-Dănuț; Dincă, Dragoș

doi:10.3389/fenvs.2022.1059906

Cited by 10 publications

(5 citation statements)

References 34 publications

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“…Nonetheless, ROA and company value are not significantly impacted by the Social or Governance scores. This finding is in line with research findings ( (Ahmad et al, 2021); (Aydoğmuş et al, 2022); (Yu & Xiao, 2022); (Dincă et al, 2022); (Rahman et al, 2023)) where the overall ESG performance results show that ESG has a positive and significant impact on corporate financial performance. However, in terms of individual ESG performance, the results are mixed.…”

Section: Discussionsupporting

confidence: 91%

“…The results of research that show negative results include those presented by ((Duque-Grisales & Aguilera-Caracuel, 2021); (Jeanice & Kim, 2023)). Meanwhile, empirical research on the relationship between ESG and firm value which provides mixed results on several measures of firm value, among others, is presented ((Raja Ahmad et al, 2021); (Yeh & Guo, 2019); (Dincă et al, 2022); (Ahmad et al, 2021); (Yordudom & Suttipun, 2020); (Ningwati et al, 2022); (Kong et al, 2023); (Aydoğmuş et al, 2022)).…”

Section: Introductionmentioning

confidence: 99%

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Sustainable investing drive by ESG performance

Indriani

2024

IJRBS

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ESGs, or sustainable business practices, are becoming more and more popular as more stakeholders, regulators, and investors want to conduct business in a way that helps address urgent global issues like environmental degradation, climate change, ethical supply chains, and global well-being. Consequently, while making investment decisions, environmental, social, and governance (ESG) factors are given more weight in the operational and strategic objectives of the organization. The purpose of this research is to determine the relationship between a company's financial success and market value and its environmental, social, and governance (ESG) performance. This research uses financial performance as a mediating impact and integrates the risk mitigation element, which is the foundation of sustainability. Data from publicly traded businesses on the Indonesia Stock Exchange with ESG risk from Sustainalytics and ESG ratings from Refinitiv were used in the study. Purposive sampling was the sampling approach utilized to acquire 48 observation firms for empirical testing. The results indicate that only the individual environmental ESG score has a positive and significant impact on financial performance and company value, whereas the composite ESG score has a positive and substantial impact on financial performance. The finding of this study is that the improvement of corporate ESG performance can increase corporate value, and corporate financial performance provides an obvious mediating effect. The findings further show that low-risk ESG scores have an impact on increasing firm value with financial performance as the mediation.

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Section: Discussionsupporting

confidence: 91%

Section: Introductionmentioning

confidence: 99%

Sustainable investing drive by ESG performance

Indriani

2024

IJRBS

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“…This finding also aligned with the findings about the disclosure of non-financial reports (Wahl et al, 2020). From the investor's perspective, the lack of standardization makes them hesitate to use the ESG disclosure as an investment decision criterion (Dincȃ et al, 2022). The positive sign supports signaling theory and accepts H1.…”

Section: Resultssupporting

confidence: 81%

Impact of ESG Disclosure Score on Firm Value: Empirical Evidence From ESG Listed Company in Indonesia Stock Exchange

Negara,

Ishak,

Priambodo

2024

EJBMR

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The trend in ESG investment was responded to by the Indonesia Stock Exchange, which released four ESG indexes. ESG indexes consist of the companies that have a better concern in ESG. Each ESG index has its positive or negative performance compared to the combined stock index. This research aims to determine the impact of ESG Disclosure on firm value. The sample of this research covers 55 companies that have been listed in the ESG index in the 2017–2021 period. The data is collected from the Bloomberg database and processed with a panel data regression model using Stata 17. The finding of this research is that there is a positive but no significant impact between the ESG Disclosure Score and firm value. This finding will contribute to the previous study about the disclosure information of non-financial information and its impact on the firm’s value in the market.

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“…Kuo [9] focused on the importance of ESG reporting for financial improvement in the airline sector. Dinka [10] explored the same connection in the case of automotive industries. However, no research has yet been conducted regarding ESG practices in the water sector.…”

Section: Introductionmentioning

confidence: 94%

How do Water Companies Address Environmental Indicators in their ESG Reports?

Sperone,

Deweerdt

2024

Adv Environ Eng Res

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As climate change is becoming an increasingly crucial issue, it has become critical for firms to report on their Environmental, Social, and Governance (ESG) aspects. In particular, this research analyzes how environmental indicators are dealt with and reported on. In the case study examined, namely the company American Water Works, GHG emissions and water management were the most important issues to the stakeholders according to the materiality assessment. It was found that the firm has significantly reduced its GHG emissions, and it is on track to meet its target of 40% reduction by 2025. This was achieved mostly through corporate power purchase agreements, although the Sustainability Report focuses on improvements to the energy efficiency of infrastructure. This underscores the possibility that companies represent ESG data in ways that are convenient to guarantee a more sustainable image in the long term, at the cost of a complete portrayal of their ESG practices. Moreover, Scope 3 emissions are not verified through a third party, which is key to ensuring the rigor and transparency of carbon emissions, and no Net Zero emissions target is mentioned in such report. For what regards water management, the Sustainability Report contains the target of reducing water per customer by 15% by 2035. Nevertheless, the report lacks a mention of Net Zero groundwater abstraction and a leakage reduction target.

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The relationship between ESG and firm value. Case study of the automotive industry

Cited by 10 publications

References 34 publications

Sustainable investing drive by ESG performance

Sustainable investing drive by ESG performance

Impact of ESG Disclosure Score on Firm Value: Empirical Evidence From ESG Listed Company in Indonesia Stock Exchange

How do Water Companies Address Environmental Indicators in their ESG Reports?

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